Workforce diversity can improve company’s bottom line

An engineer operates a computer numerical control machine. Studies show that diversity and inclusion can improve a business’ profits.

A successful diversity and inclusion strategy can help business performance in many ways.

Research shows that companies with more diversity perform better financially.

According to a report by McKinsey & Co. in its January publication “Delivering Through Diversity,” “Companies in the top quartile for gender diversity on executive teams were 21 percent more likely to outperform on profitability and 27 percent more likely to have superior value creation.

“Companies in the top quartile for ethnic/cultural diversity on executive teams were 33 percent more likely to have industry-leading profitability.”

In addition, the data revealed that not being diverse can hurt a company’s performance.

“Overall, companies in the bottom quartile for both gender and ethnic/cultural diversity were 29 percent less likely to achieve above-average profitability than were all other companies in our data set,” according to the report.

BETTER PERFORMANCE

The recent findings support and update results from an earlier study, “Diversity Matters,” published by McKinsey & Co. in 2015.

As “Delivering Through Diversity” notes: “The relationship between diversity and business performance persists. The statistically significant correlation between a more diverse leadership team and financial outperformance demonstrated three years ago continues to hold true on an updated, enlarged and global data set.”

“We talk to our companies about pay equity and total rewards, and how their brand communicates their culture and how they need to have retention strategies, engagement and advancement strategies in their talent systems,” Petrini said.

“We also talk to clients about engagement surveys to measure where they are starting from and then how to activate the diversity and inclusion you need to be a destination employer.”

The idea is that diversity and inclusion are not simply true-false, yes-no concepts. Rather, the process is just that – a process or evolution that a company embarks on with aspirations to move toward increased diversity and inclusion.

INCREASED JOB SATISFACTION

How do diversity and inclusion bring about improved performance? They help foster an employee’s sense of engagement with the company that can lead to increased job satisfaction and employee productivity.

This success has been noted at GE Digital’s New Orleans location.

“We are committed to an environment where all employees feel safe and empowered to bring their best selves to work every day,” said Tracy Thomas, communications manager at GE Digital New Orleans. “This is GE’s culture of inclusion.”

When employees are encouraged to be themselves and accepted as they are, they are happier and more productive at work. An employee who feels alienated in the workplace is not going to be happy going to work. An unhappy employee is to be less productive, drags down morale of the group, and spreads a negative image of the company.

MANY PERSPECTIVES

Increased diversity and inclusion can help a company relate better to its customers and community.

“By creating an environment where a diverse workforce is a stated organizational goal, we make intentional choices – from how we word job descriptions, to how we recruit and how we ultimately create a candidate slate for roles,” Thomas said. “This diversity ensures we have many different perspectives when solving problems, as each person brings their own background and experiences.”

This diversity of background and experiences contributes positively to the creativity of the team, which translates into better products, processes and customer service.

Inclusion and diversity combine for one of the core values at ONE Gas, said Pierce Norton, president and CEO of the Tulsa, Okla.-based company which serves Oklahoma, Kansas and Texas.

“This commitment helps us continually focus on every employee making a difference and contributing to our success,” Norton said. “For example, we have seen employee development opportunities flourish because of our employee resource groups.

“Specifically, we have had several women participate in the women’s ERG [employee resource group] where employees have developed leadership skills and gained exposure throughout the organization due to their participation in the ERG.”

OPENING MINDS

Norton also noted the personal growth and development that employees have experienced at ONE Gas.

“While we still have a lot of work to do with respect to inclusion and diversity, we have already created an awareness among employees of unconscious bias some of them may have and how that could impact their daily work,” he said.

“We’re proud to say our I&D [inclusion and diversity] efforts have opened the minds of our employees to consider different perspectives in their daily lives and decision making.”

CULTURE IS PARAMOUNT

Express’ Petrini said diversity is about the mix that makes everyone unique, and what companies do with the mix is their strategy for diversity and inclusion.

“A company can focus on diversity, but if they do not have an inclusive culture, then it won’t work,” she said.